Here we outline our four businesses, through which we contribute widely to the lives of people around the world.
Machine tools
Citizen began production of machine tools in 1936, utilizing the technologies and know-how developed through the manufacture of watch parts. Our products contribute to the development of manufacturing industries all over the world.
About Us
More than a century since it was founded in 1918 with the desire to produce Japanese-made watches, the CITIZEN Group has evolved into a corporate entity engaged in a wide range of businesses.
CITIZEN's corporate philosophy, "Loved by citizens, working for citizens" is to
deeply contribute to the lives of people around the world through the manufacturing of products that are loved and trusted by citizens.
Message From President & CEO
Crafting a new tomorrow Towards sustainable value creation
The CITIZEN Group joined the United Nations Global Compact in April 2005 and supports its Ten Principles covering four areas: Human Rights, Labour, Environment, and Anti-Corruption. By incorporating these principles into its business activities, the Group fulfills its corporate social responsibilities and promotes initiatives aimed at realizing a sustainable society.
Guided by its corporate philosophy, "Loved by citizens, working for citizens." the Group established the CITIZEN Group Code of Conduct in June 2016 as a set of concrete action guidelines, encouraging each employee to act with a strong sense of ethics and responsibility.
Furthermore, in June 2026, the Code was revised not only to reflect the guidelines of Keidanren (Japan Business Federation) but also to align with the OECD Guidelines for Multinational Enterprises and the United Nations Guiding Principles on Business and Human Rights. Through this revision, references to three key areas—human rights due diligence, climate change and biodiversity, and AI and digital ethics—were newly incorporated, strengthening the Group’s ability to respond to evolving global social expectations. In addition, new initiatives related to crisis management and business continuity were introduced, and the responsibilities of top management were clarified, reinforcing the Group’s commitment to compliance.
Article 3 of the revised Code, entitled "Fair Business Practices and Shared Prosperity throughout the Supply Chain," emphasizes not only compliance with laws and regulations but also conduct based on high ethical standards.
Moreover, in response to the increasing complexity of business operations accompanying global expansion, the Group established its Anti-Corruption Policy in April 2020 with the aim of eliminating all forms of corruption, including fraud and bribery. The policy is also aligned with the Ten Principles of the United Nations Global Compact. Through these policies and initiatives, we continue to share the importance of maintaining a strong compliance mindset among all employees and strive to build trusting relationships with our stakeholders, including customers and business partners.
The CITIZEN Group Anti-Corruption Policy (Established: April 1, 2020)
Preface
Since its establishment, the CITIZEN Group has been seeking to contribute widely to the lives of people around the world through its business activities under the corporate philosophy of "Loved by citizens, working for citizens.". The CITIZEN Group recognizes that corruption in all its forms, including extortion and bribery, is one of the key issues that significantly undermines corporate trust. We will clarify our attitude that we will not allow any such misconduct in the pursuit of profits and will actively work to prevent corruption, including giving or receiving any gift or entertainment that may cause social suspicion or distrust, and will build a sound relationship with our stakeholders. We also seek understanding and cooperation for similar initiatives throughout the supply chain.
We will comply with the international anti-corruption rules and laws and the regulations relating thereto in the countries and regions where we do business.
We will not give or receive gifts or entertainment for the purpose of acquiring or maintaining unfair profits or preferential treatment. Also, we will not give or receive gifts or entertainment in a manner that deviates from normal business practices or social common sense. We will continue to review our business practices to ensure economic rationality, consumer interests, transparency, and fairness.
Based on fair, transparent, and free competition, we will maintain clean and healthy relationships with government agencies, for example, by prohibiting facilitation payments.
We will not approach antisocial forces and will not be involved in such crimes as money laundering.
In order to prevent the violation of laws and regulations, to detect such violations early on, and to reinforce our self-cleaning actions, we will establish an internal reporting system that allows anonymous reporting to both internal and external organizations.
By working to understand social trends related to anti-corruption and by implementing anti-corruption education, we will continuously improve our anti-corruption efforts as needed, including training officers and employees on this policy and the relevant internal rules.
In the event that an unexpected situation arises in relation to the prevention of corruption, we will promptly investigate the cause, take appropriate action to prevent recurrence, disclose information to the public, and fulfill accountability.
We will conduct audits to ensure that the anti-corruption system based on this policy is functioning properly, that necessary training is provided, that appropriate responses can be made to unforeseen circumstances, and that accountability and other actions are satisfied through information disclosure. Audit results will be periodically reported to the Board of Directors. This policy shall be reviewed periodically and approved by the Board of Directors.
Compliance Policy and Promotion System
Based on our corporate philosophy "Loved by citizens, working for citizens." The CITIZEN Group places the highest priority on legal and regulatory compliance and ethical behavior. We aim to maintain high ethical standards in all our business activities and build relationships of trust with our stakeholders.
Compliance policy Our compliance policy, stated in our Group Code of Conduct as well, is based on the following fundamental values:
Compliance with laws and regulations: We will strictly comply with domestic and international laws and regulations and practice transparent management.
Ethical behavior: We seek each employee’s ethical decisions and behavior with integrity.
Social responsibility: We will pay full consideration to environmental conservation and social contributions and promote efforts to realize a sustainable society.
Compliance system We have established a system to promote compliance throughout our organization, as shown below.
The Group Legal Compliance Committee, the Group Safety Trade Controls Committee, and the Group Fair Subcontracting Committee, each of which is chaired by an executive in charge of compliance, lead the promotion of compliance. The Management Committee, whose members include the presidents of major operating companies, and the Board of Directors oversee the formulation and implementation of Group-wide policies, including the CITIZEN Group Anti-Corruption Policy.
Comprising the heads of legal affairs departments of Citizen Watch Co., Ltd. and other Group companies, these committees are responsible for formulating compliance-related measures, checking their implementation status, and providing compliance education and training.
Additionally, the Quality Compliance Committee, which comprises major operating companies’ executives in charge of quality compliance, performs operational functions, including preventing and addressing quality incompliance.
The Internal Audit Department, whose independence is ensured, regularly audits whether the compliance system is functioning properly and proposes improvements as needed. The results of these audits are reported at the Management Committee, whose members include the presidents of major operating companies, and to the Board of Directors.
Compliance Training and Internal Auditing
Employee Training
To ensure that all members of The CITIZEN Group share a common awareness of compliance, we regularly conduct training, education, and audits concerning The CITIZEN Group Code of Conduct, the CITIZEN Group Anti-Corruption Policy, and other guidelines to raise compliance awareness throughout the Group.
Specifically, we provide compliance training to management, all employees (including part-time employees), and contract employees based on the Group Code of Conduct, which provides for commitment to safety, fair competition, measures for environmental conservation, social contributions, respect for human rights, prohibition of contact with anti-social forces, prevention of corruption, and responsible behavior and ethical standards overseas. In FY2025, among 6,389 intended trainees, 6,374 took the training, with an attendance of 99.8%.
Furthermore, we conduct awareness surveys on the permeation of the Group Code of Conduct and compliance. We disclose the results both inside and outside the Group and use them as reference in our efforts to increase corporate value.
FY2025 Training Results
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Training
Outline
Number of trainees
Compliance training
Training on the Code of Conduct, Anti-Corruption Policy, Human Rights Policy, etc.
Intended trainees: 6,389 Actual trainees: 6,374 Attendance: 99.8%
Anti-Corruption Initiatives
The CITIZEN Group's Anti-Corruption Initiatives
In addition to the CITIZEN Group Anti-Corruption Policy, which prohibits acts of corruption, including bribery, The CITIZEN Group has also established the CITIZEN Group Anti-Bribery Regulations as internal Group rules. These policies and regulations are disseminated to all Group members and all employees through e-learning training programs.
The CITIZEN Group strives to stay abreast of social trends and conditions within the Group and ensure business practices that are fair, transparent, open to competition, and responsible through revising its initiatives as necessary.
Anti-Corruption Initiatives in the Supply Chain
The CITIZEN Group Anti-Corruption Policy requires suppliers to understand and cooperate with the Group's initiatives based on this Policy. Specifically, we distribute "Requests to Our Business Partners," which include the Anti-Corruption Policy, to our suppliers in Japan and overseas. In addition, we ask our permanent contractors, such as business agents, to cooperate in our efforts to prevent corruption by complying with the Group Code of Conduct.
Since FY2021, suppliers have been asked to confirm and consent to the content of CITIZEN's rules and policies, such as the Group Anti-Corruption Policy, the Group Code of Conduct, the Group Human Rights Policy, and the Group Basic Policy on Health and Safety, when concluding new contracts and renewing contracts. Thus, we are working to ensure that they are fully aware of the prevention of corrupt practices.
The CITIZEN Group has established and operates an internal whistleblowing system for the prevention and early detection of misconduct, including violations of laws and regulations, fraud, corruption, and other improper acts,* as well as for enhancing the Group's self-correcting functions.
Specifically, the Group operates the CITIZEN Group Compliance Hotline for officers and employees of Citizen Watch Co., Ltd. and all other Group companies. The hotline provides four reporting channels: an external professional organization, an internal contact point, Audit & Supervisory Committee members, and the corporate headquarters. Reports, requests for consultation, and proposals may be submitted either anonymously or under the reporter’s name through a variety of methods, including telephone, e-mail, face-to-face meetings, QR code access, and online reporting forms.
To ensure appropriate operation of the system, the Group has established the Group Compliance Hotline Rules with reference to the internal whistleblowing guidelines issued by Japan’s Consumer Affairs Agency and the Corporate Governance Code. These regulations clearly stipulate the protection of whistleblowers’ confidentiality and the prohibition of any disadvantageous treatment of reporters. In addition, the Group has prepared guidelines for both users and hotline personnel. These efforts help create an environment in which anyone can comfortably use the system and promote the standardization of report-handling procedures. As a result, all employees, including former employees who left the Group within the previous year, can report concerns safely and without hesitation. The system also complies with the amended Whistleblower Protection Act, which came into effect in June 2022.
To enhance the effectiveness of the system, it is essential to ensure thorough protection of whistleblowers and to raise awareness of the prohibition of retaliatory or disadvantageous treatment. According to the results of awareness surveys conducted since FY2007, recognition of the hotline has increased continuously for ten consecutive years since FY2015, reaching more than 88% in FY2025.
The number of whistleblowing reports in FY2025 was 62, consisting of 57 received internally, 5 received by external contact points, and 0 submitted to Audit & Supervisory Committee members. As a result of investigations and corrective actions taken on all reports, there were no cases of serious human rights violations or violations of the Anti-Corruption Policy. In FY2026, we will continue to promote awareness of the hotline while creating an environment that supports human rights due diligence through greater utilization of feedback received and the development of rules that accommodate diverse working styles.
* Our approach to the prevention of improper acts is established in Article 3 of The CITIZEN Group Code of Conduct, which states that the Group will "engage in business practices that are fair, transparent, open to competition, and responsible" throughout the supply chain (fairness, transparency, openness to competition, responding to government agencies etc., export/import controls, prohibition of contact with anti-social forces, prevention of money laundering, responsible and sustainable procurement).
Intellectual Property Strategy
The CITIZEN Group respects the intellectual property rights of others and strives not to infringe on them. Therefore, we are constantly checking for infringement on the intellectual property of others, and if we discover any obstacles to the rights of others, we promptly take countermeasures to prevent infringement before it happens.
At the same time, we identify the intellectual property necessary to advance our business and proactively acquire the rights to such property. In addition, when we discover infringements of our intellectual property rights by third parties, we take resolute countermeasures.
Furthermore, we are more effectively engaged in the planning and implementation of management and business strategies and promoting activities to contribute to the company's sustainable growth by utilizing intellectual property information.
The CITIZEN Group will, in line with the intent of the intellectual property rights system, continue to promote appropriate and effective intellectual property activities.
The CITIZEN Group has established the CITIZEN Group Rules for Security Trade Control to provide reliable and secure trade management within the Group. We have also established the CITIZEN Group Security Trade Control Committee, comprising Citizen Watch Co., Ltd. and operating subsidiaries. This committee provides guidance, education, and information to Group companies and carries out audits.
CITIZEN MACHINERY CO., LTD. takes measures to prevent the improper export of industrial machinery and its improper resale or re-export overseas in order to ensure compliance with the Foreign Exchange and Foreign Trade Act. In addition, the company’s machine tools have a relocation detection system (which inactivates the tools it detects their relocation) as standard equipment. Thus, even after export, we strive to control the users and uses of the machinery to ensure that it is not used for the development of weapons of mass destruction, etc. through resale or re-export.
Information Security
In recent years, there has been an increasing number of cases of cyberattacks that have a devastating impact on the entire supply chain, such as the shutdown of all domestic bases. The CITIZEN Group recognizes the risks related to information security, such as information leaks and system downtime, as important risks and has strengthened its structure by establishing the Group Information Governance Committee in 2016, chaired by the director in charge of general affairs, to address personal information protection, trade secret management, and information security management. Specifically, we are working to disseminate the CITIZEN Group Information Security Policy, which was revised in November 2020, throughout the company, and we are also working closely with our overseas offices to promote understanding of the importance of information security, based on compliance with the laws and regulations of each country. We continuously provide alerts and guidance regarding ransomware, phishing scams, and other cybersecurity threats. In FY2025, we introduced a new security awareness training program to help employees better understand cybersecurity threats and risks and take appropriate actions. Through these educational and awareness-raising activities, we are fostering information security awareness across the Group both in Japan and overseas.
We are building a system to implement security measures in cooperation with the information system departments of our main overseas bases and the head office department to maintain the IT environment for CITIZEN WATCH's global operations.
In particular, given that cyberattacks today mostly exploit vulnerabilities in network devices and servers, we put into operating a vulnerability management system in FY2024 and introduced Attack Surface Management (ASM) in FY2025 to reduce cyberattack risks to the entire Group both in Japan and overseas.
We also actively use data centers and cloud services to build a safe and stable IT infrastructure that is resistant to accidents and disasters to protect the information system environment. The initiatives we have in place also contribute to power savings and CO2 emissions reduction.
CITIZEN-SIRT Initiatives
In anticipation of severe incidents, such as cyberattacks, the CITIZEN-SIRT, which was established in June 2020, monitors risks, such as system downtime, in usual times. In the event of an actual incident, it makes prompt responses, from the initial response to cooperation with the relevant departments and problem resolution.
Since FY2022, CITIZEN-SIRT has taken the lead in conducting annual tabletop exercises to strengthen preparedness for rapid incident response. Using scenarios developed in cooperation with a security vendor, participants review and verify appropriate response procedures in the event of cybersecurity incidents. In FY2025, training exercises were conducted with Group companies, and a comprehensive review of the Group’s security environment was undertaken, including the development of business continuity plans and response guidelines to prepare for potential incidents.
In addition, based on minor incidents that did not lead to information leaks or system downtime that occurred in FY2021, we introduced endpoint detection and response (EDR) systems into Citizen Watch Co., Ltd.'s system environment in FY2022 to monitor the networks and prevent cyberattacks, thereby strengthening network security. In FY2023, the installation of EDR systems was completed at all CITIZEN Group sites. Although no incidents requiring a CITIZEN-SIRT response occurred in FY2025, information on security incidents was shared with IT personnel and risk management personnel at Group companies to help prevent similar incidents in the future.
Protection of Personal Information
The CITIZEN Group, under the supervision of the Group Information Governance Committee, has established and disseminated its policy for handling all personal information, which is provided by customers, suppliers, and other stakeholders in business activities, based on the CITIZEN Group Information Security Policy and the CITIZEN Group Privacy Policy. We are committed to continued maintenance and management of information protection, including e-learning on the protection of personal information for employees of domestic Group companies. The specifics of the CITIZEN Group Privacy Policy are as follows.
TOKYO BIJUTSU, a publisher of art books and other publications, acquired the right to use the PrivacyMark* in 2007 to ensure the protection of personal information and strives to secure the trust of business partners. In March 2025, the PrivacyMark certification was renewed for the ninth time. Training on personal information protection is regularly provided to all employees, including part-time workers, and tests to verify the effectiveness of the training have confirmed that awareness of personal information protection has firmly taken root.
* PrivacyMark: A registered trademark (service mark) that the Japan Institute for Promotion of Digital Economy and Community (JIPDEC) allows businesses to use on the condition that they meet certain requirements for personal information protection.
Response to Anti-Social Forces
The CITIZEN Group recognizes that connections to anti-social forces significantly impair social credibility in a company and have a serious impact on the company's continued existence. Therefore, our fundamental policy is to take a firm stand against demands for unjust favors or the like from anti-social forces and organizations, and we are thoroughly committed to severing any relationships with anti-social forces.
We have developed and reinforced systems that block any relationships with anti-social forces by introducing clauses to exclude organized crime groups in the various contracts entered into by Group companies. Furthermore, we are constantly promoting activities to eliminate anti-social forces in cooperation with local businesses, the police, and other external organizations concerned.
Training Sessions on the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors
To ensure appropriate subcontracting transactions and prevent violations of the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors, The CITIZEN Group provides on-the-job training in the workplace as well as guidebooks and e-learning programs to systematically learn about the basics of the Act.
The CITIZEN Group's business is supported by many business partners at every stage of the value chain. We are working to improve our business methods to make them more desirable to build a true win-win relationship for both the contractee and the contractor.
Citizen Watch Co., Ltd. also endorses the Declaration of Partnership Building promoted by the Ministry of Economy, Trade and Industry. The Company is committed to building new partnerships for collaboration, coexistence, and coprosperity with supply chain business partners and other value-creating enterprises.
The CITIZEN Group recognizes that paying appropriate taxes is not only a duty but also an important social contribution in line with its corporate philosophy of "Loved by citizens, working for citizens." We fulfill our corporate social responsibility by paying appropriate taxes and increasing tax transparency through appropriate disclosure. As in the previous fiscal year, in FY2025, Citizen Watch Co., Ltd. continued to provide tax e-learning programs for all employees to spread knowledge of taxes among them and implement other measures to ensure their tax compliance.
Results of tax e-learning training programs in FY2025 Among 1,039 intended trainees, 950 participated in the training, with an attendance of 91.4%.
The CITIZEN Group Tax Policy (Enacted: April 1, 2023)
Based on the corporate philosophy of "Loved by citizens, working for citizens." the CITIZEN Group believes that paying appropriate taxes is not only a duty, but also an important social contribution. Based on this belief, the CITIZEN Group hereby establishes the CITIZEN Group Tax Policy as the Group's unified basic policy on taxation.
Compliance with Laws and Regulations
The CITIZEN Group shall comply with the tax laws and regulations of each country and region in which it operates, respect the OECD Guidelines and other international tax rules, and file tax returns and pay taxes in an appropriate and timely manner.
Tax Governance
Under the supervision of the director in charge of the Accounting Department, Citizen Watch Co., Ltd. confirms tax information of its subsidiaries as the parent company and strives for centralized management of tax risks by the parent company. If tax risks become apparent during tax audits, etc., at subsidiaries, we gather detailed information and take appropriate action.
Tax Planning
The CITIZEN Group makes effective use of tax incentives, etc. in each country and region where they are available during normal business activities and strives to achieve an optimal tax burden. We do not engage in excessive tax planning or use tax havens for the purpose of tax avoidance, contrary to the intention of laws and regulations.
Transfer Pricing Taxation
The CITIZEN Group strives to distribute profits appropriately according to functions and risks based on the concept of arm's length pricing for international transactions between Group companies. We also strive to prepare appropriate transfer pricing documentation in accordance with the transfer pricing taxation systems of each country and region.
Tax Risk Management
The CITIZEN Group thoroughly considers tax risks in business activities in advance, and if necessary, seeks advice and guidance from external experts to reduce tax risks. If any questions arise regarding tax treatment or interpretation, etc., we will respond appropriately by seeking advice from outside experts, etc., or making prior inquiries to the tax authorities as necessary.
Relationship with Tax Authorities
The CITIZEN Group strives to maintain appropriate relationships with tax authorities through honest responses and fact-based explanations.
